First Take: Government didn't matter - this time

Nov. 8, 2013
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A jobs sign is seen on the front of the US Chamber of Commerce building in this September 2, 2010 file photo in Washington, DC. / KAREN BLEIER AFP/Getty Images

by Tim Mullaney, USA TODAY

by Tim Mullaney, USA TODAY

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The government shutdown likely contributed to October's higher unemployment rate -- but it didn't appear to hurt job creation at all.

The government says 204,000 new jobs were created in October, significantly better than an upwardly-revised 163,000 for September, and August's employment growth was revised upward by 45,000 jobs to 238,000. The Labor Department's survey of business establishments showed the government shutdown we all hoo-hahed over had no visible effect on hiring.

But the unemployment rate is calculated using a different survey - it's a look at households, and the households told a different story. The household survey - basically, a poll that is pretty accurate because of a very large sample size - estimated that the number of people who reported being on temporary layoff increased by 448,000 last month. That included furloughed government employees who were temporarily unemployed because of the shutdown.

The potential civilian labor force was also slightly smaller this month, but not enough to affect the arithmetic. The Labor Department also cautioned that the data on federal workers was not seasonally adjusted, making comparisons difficult.

Bottom line: The shutdown affected the unemployment rate some. But hurt the economy? Not really.

The important part is that the number of jobs created was pretty strong, and where the jobs are coming from is fairly encouraging.

Manufacturers added 19,000 positions, much better than they have been doing. Construction employment, one of the biggest keys to getting the economy the rest of the way to recovery, rose by 11,000. That's better than the industry has done for most of this year. Leisure and hospitality added 53,000 after a lull in growth during September.

The way to get unemployment below 6% is to see hiring rise in construction, in government (which lost 8,000 jobs last month, with Washington shedding 12,000 workers and state and local governments adding 4,000), and manufacturing. Most of that happened last month.

There are plenty of bumps still to come, as there have been throughout the long march back from the financial crisis of 2008. And there have been plenty of arguments about whose policies deepened or lengthened the slog.

But for one day, the news is pretty decent -- and this one Washington-driven debacle seems, at least, not to have made things significantly worse.